One 77-year-old’s search for the truth: 9/11, election fraud, illegal wars, Wall Street criminality, a stolen nuke, the neocon wars, control of the U.S. government by global corporations, the unjustified assault on Social Security, media complicity, and the "Great Recession" about to become the second Great Depression. "The most important truths are hidden from us by the powerful few who strive to steal the American dream by keeping We the People in the dark."

Author and journalist Katie Pavlich talks to Glenn Reynolds about the Fast and Furious firearms scandal that resulted in the murder of a Border Patrol agent. Pavlich's research shows that the ATF put guns in the hands of criminals, but never planned to track these weapons. Was the Obama Administration using Fast and Furious to undermine the Second Amendment? Find out.

UC Davis Students and Faculty Face Prison Time for Peaceful Protest Against Bank

The pepper spraying of UC Davis students shocked the nation,
but the persecution that the Davis Dozen protesters face is far worse.

April 27, 2012 | The pepper-spraying of University of California Davis protesters on
November 18, 2011 promised to be a galvanizing moment for the student
movement after University Police Lieutenant John Pike used military
grade pepper spray at point blank range on seated protesters who had
peacefully assembled to demonstrate against tuition hikes at UC Davis.
The world took notice. Not only did the Lieutenant Pike pepper-spray
“meme” spread like wildfire on Facebook and Twitter, major news outlets
gave the event coverage, to varying degrees of depth and understanding.

But it seems that the University administration has successfully
evaded scrutiny of the role it played in a series of events that began
in January at UC Davis when 12 protesters, some of whom had been
pepper-sprayed in November, staged another peaceful sit-in at the campus
branch of US Bank. The sit-in was an important political action in
defense of public funding of the University and against the replacement
of that funding by private contracts with corporations. The protestors
won an enormous victory when US Bank closed it University branch on
February 28, possibly breaking its agreement with UC Davis.

Banks have no place on University campuses for many reasons. Part of
the function of the contract UC Davis had with US Bank allowed the
administration’s continued shift of funding of the University from
public to private sources. This is particularly problematic when the
private source of funding is a corporate bank, because banks make money
from rising tuition costs, in the form of interest from student loans.
In other words: university contracts with banks encourage tuition
hikes, because banks stand to profit directly from rising tuition, while
the administration comes to rely on funding from bank contracts.

This is a part of a vicious cycle that is destroying the public
character of the UC system — and costing thousands of dollars to
students in increased tuition and long-term debt every year. Just six
years ago, tuition at the University of California was $5,357. Tuition
is currently $12,192. According to current proposals, it will be $22,068
by 2015-2016, amounting to a 312% increase in just 10 years. These
tuition hikes increasingly force more and more students out of higher
education altogether and put untenable financial burdens on those who
must take out crippling loans and work extra jobs for an education that
is now public in name only.

The protestors’ success in this fight against the privatization
agenda of the University should be cause for celebration; however, on
March 29, nearly a month after the bank pulled out of UC Davis, the 11
students and 1 professor involved in the sit-in received orders to
appear at Yolo County Superior Court. At the request of the UC Davis
administration, District Attorney Jeff Reisig is charging the so-called
Davis Dozen with 20 counts each of obstructing movement in a public
place, and one count of conspiracy. If convicted, the protesters could
each face up to 11 years each in prison, and $1 million in damages. The
UC Davis administration is sending a clear message to protesters:
dissent will not be tolerated. And those who do protest will face a
violence much more pernicious than pepper-spraying at the hands of
Lieutenant Pike.

Unfortunately, this time around there is no graphic youtube video
that could potentially go viral and capture the psychological and
financial stress the protesters are under as they face the possibility
of having to leave school and, even worse, say goodbye to friends,
family, partners and children as they go off to serve time in the
California penal system. There is no video to elicit gasps of horror at
the threat of a lifetime of financial ruin that the protesters face.
There is no video to show the unremitting repression of their
democratic right to freedom of assembly and political protest.

There is no video to capture the machinations of the UC Davis
administration, under the direction of Chancellor Linda Katehi, who
appears to be seeking retribution for the pending ACLU lawsuit against
the university for the pepper spray incident. Whereas no charges were
filed against the protestors after the pepper spray incident, the
District Attorney is now quite willing to prosecute the 12 demonstrators
charged with “obstructing movement in a public place”.

Obstructing movement in a public place? That sounds a whole lot like
an ad hoc law designed to silence dissent. And what better time for
the UC Davis Administration to subject protesters to an absurd version
of the law than when nobody is watching? If the world were watching,
surely we would ask why these peaceful protesters could be sentenced to
11 years in prison, which, for the sake of comparison, is the maximum
penalty for voluntary manslaughter in the state of California. It bears
repeating: students and faculty who put their educations, careers,
families as well as their own bodies on the line to defend the
accessibility of public education for all, now stand to serve the same
sentence as a felon who has killed another human being.

The pepper spraying of UC Davis students shocked the nation, but the
persecution that the Davis Dozen protesters face is far worse. It is
life-altering for them. We cannot allow the story of the Davis Dozen
to fall through the cracks, even though it might not strike a chord as
immediately visceral as the now infamous video of Lieutenant Pike
attacking students with a chemical agent. Let us reflect on the tragic
irony that the state funding that should be allocated to aiding the
intellectual growth and development of the 11 students involved in the
sit-in might be funneled towards their incarceration. The modest salary
that is paid to a professor, committed enough to advocate for public
education might be replaced by state money to keep this highly gifted
professional locked up.

And indeed, if we look at where the state money paid by the people of
California for services to foster the common good, we can plainly see
that this scenario is a sinister microcosm. In 2011, the UC and CSU
systems account for $5.6 billion of state funding, while the prisons are
receiving $9.6 billion dollars from the state. The state spends about
$50,000 per inmate each year. We cannot look the other way and allow
the boot of the penal system to fall on these protesters, while corrupt
University administrators secure the way to enrich the 1% on
California’s dime with impunity and at the expense of public education.
We must immediately demand that all charges be dropped against the
Davis Dozen.

Sunday, April 29, 2012

"Politics Is at the Root of the Problem"

by Joseph Stiglitz — 23.04.2012

Austerity policies are driving us towards a double-dip
recession, warns US economist Joseph Stiglitz. He sat down with Martin
Eiermann to discuss new economic thinking and the influence of money in
politics.

The European: Four years after the
beginning of the financial crisis, are you encouraged by the ways in
which economists have tried to make sense of it, and by the ways in
which those insights have been taken up by policy makers?
Stiglitz: Let me break this down in a slightly different way. Academic
economists played a big role in causing the crisis. Their models were
overly simplified, distorted, and left out the most important aspects.
Those faulty models then encouraged policy-makers to believe that the
markets would solve all the problems. Before the crisis, if I had been a
narrow-minded economist, I would have been very pleased to see that
academics had a big impact on policy. But unfortunately that was bad for
the world. After the crisis, you would have hoped that the academic
profession had changed and that policy-making had changed with it and
would become more skeptical and cautious. You would have expected that
after all the wrong predictions of the past, politics would have
demanded from academics a rethinking of their theories. I am broadly
disappointed on all accounts.

The European: Economists have seen the flaws of their models but have not worked to discard or improve them?
Stiglitz: Within academia, those who believed in free markets before the
crisis still do so today. A few people have shifted, and I want to give
credit to them for saying: “We were wrong. We underestimated this or
that aspect of our models.” But for the most part, the response was
different. Believers in the free market have not revised their beliefs.

The European: So let’s take a longer view. Do you think that
the crisis will have an effect on future generations of economists and
policy-makers, for example by changing the way that economic basics are
taught?
Stiglitz: I think that change is really occurring with the young people.
My young students overwhelmingly don’t understand how people could have
believed in the old models. That is good. But on the other hand, many
of them say that if you want to be an economist, you still have to deal
with all the old guys who believe in their wrong theories, who teach
those theories, and expect you to believe in them as well. So they
choose not to go into those branches of economics. But where I have been
even more disappointed is American policy-making. Ben Bernanke gives a
speech and says something like, there was nothing wrong with economic
theory, the problems were a few details in implementation. In fact,
there was a lot wrong with economic theory and with the basic policy
framework that was derived from theory. If your mindset is that nothing
was wrong, you will not demand new models. That’s a big disappointment.

The European: There seemed to have been quite a bit of
disagreement among Obama’s economic advisers about the right course of
action. And in Europe, fundamental economic principles like the absolute
focus on GDP growth have finally come under attack.
Stiglitz: Some American policy-makers have recognized the danger of “too
big to fail,” but they are a minority. In Europe, things are a bit
better on the rhetorical side. Influential economists like Derek Turner
and Mervyn King have recognized that something is wrong. The Vickers
Commission has thoughtfully re-examined economic policy. We have nothing
like that in the United States. In Germany and France, the financial
transactions tax and limits to executive compensation are on the table.
Sarkozy says that capitalism hasn’t worked, Merkel says that we were
saved by the European social model – and they are both conservative
politicians! The bankers still don’t understand this, which explains why
we still see the head of the European Central Bank, Mario Draghi,
arguing that we have to give up the welfare system at a time when Merkel
says the exact opposite: That the social model kept us going when the
central banks failed to do their regulatory job and used politics to
change the nature of our societies.

The European: How have your own convictions been affected by the crisis?
Stiglitz: I don’t think that there has been a fundamental change in my
thinking. The crisis has reinforced certain things I said before and
shown me how important they are. In 2003, I wrote about the risk of
interdependence, where the collapse of one bank can bring about the
collapse of other banks and increase the fragility of the banking
system. I thought it was important, but the idea wasn’t picked up at the
time. The same year we looked at agency problems in finance. Now we
recognize just how important those issues are. I argued that the real
issue in monetary economics is about credit, not money supply. Now
everybody recognizes that the collapse of the credit system brought down
the banks. So the crisis really validated and reinforced several
strands of theory that I had explored before. One topic that I now
consider much more important than I did previously is the question of
adjustment and the role of exchange rate systems like the Euro in
preventing economic adjustment. A related issues is the linkage between
structural adjustment and macroeconomic activity. The events of the
crisis have really induced me to think more about them.

The European: The financial transaction tax seems to have
died a political death in Europe. Now, economic policy in Europe seems
largely dominated by the logic of austerity, and by forcing other
European countries to become more like Germany.

Stiglitz: Austerity itself will almost surely be disastrous. It is
leading to a double-dip recession that could be quite serious. It will
probably make the Euro crisis worse. The short-term consequences are
going to be very bad for Europe. But the broader issue is about the
“German model.” There are many aspects to it – among them the social
model – that allow Germany to weather a very big dip in GDP
by offering high levels of social protection. The German model of
vocational training is also very successful. But there are other
characteristics that are not so good. Germany is an export economy, but
that cannot be true for all countries. If some countries have export
surpluses, they are forcing other countries to have export deficits.
Germany has taken a policy that other countries cannot imitate and tried
to apply it to Europe in a way that contributes to Europe’s problems.
The fact that some aspects of the German model are good does not mean
that all aspects can be applied across Europe.

The European: And it does not mean that economic growth satisfied the criteria of social fairness.
Stiglitz: Yes, so there is one other thing we have to take into account:
What is happening to most citizens in a country? When you look at
America, you have to concede that we have failed. Most Americans today
are worse off than they were fifteen years ago. A full-time worker in
the US is worse off today than he or she was 44 years ago. That is
astounding – half a century of stagnation. The economic system is not
delivering. It does not matter whether a few people at the top
benefitted tremendously – when the majority of citizens are not better
off, the economic system is not working. We also have to ask of the
German system whether it has been delivering. I haven’t studied all the
data, but my impression is no.

The European: What do you say to someone who argues thus:
Demographic change and the end of the industrial age have made the
welfare state financially unsustainable. We cannot expect to cut down on
our debt without fundamentally reducing welfare costs in the long run.
Stiglitz: That is absurd. The question of social protection does not
have to do with the structure of production. It has to do with social
cohesion or solidarity. That is why I am also very critical of Draghi’s
argument at the European Central Bank that social protection has to be
undone. There are no grounds upon which to base that argument. The
countries that are doing very well in Europe are the Scandinavian
countries. Denmark is different from Sweden, Sweden is different from
Norway – but they all have strong social protection and they are all
growing. The argument that the response to the current crisis has to be a
lessening of social protection is really an argument by the 1% to say:
“We have to grab a bigger share of the pie.” But if the majority of
people don’t benefit from the economic pie, the system is a failure. I
don’t want to talk about GDP anymore, I want to talk about what is happening to most citizens.

The European: Has the political Left been able to articulate that criticism?
Stiglitz: Paul Krugman has been very strong on articulating criticism of
the austerity arguments. The broader attack has been made, but I am not
sure whether it has been fully heard. The critical question right now
is how we grade economic systems. It hasn’t been fully articulated yet
but I think we will win this one. Even the Right is beginning to agree
that GDP is not a good measure of economic progress. The notion of the welfare of most citizens is almost a no-brainer.

The European: It seems to me that much of the discussion is still about statistical measurements – if we’re not measuring GDP,
we’re measuring something else, like happiness or income differences.
But is there an element to these discussions that cannot be put in
numerical terms – something about the values we implicitly bake into our
economic system?
Stiglitz: In the long run, we ought to have those ethical discussions.
But I am beginning from a much narrower base. We know that income
doesn’t reflect many things we care about. But even with an imperfect
indicator such as income, we should care about what happens to most
citizens. It’s nice that Bill Gates is doing well. But if all the money
went to Bill Gates, the system could not be graded as successful.

The European: If the political Left hasn’t been able to fully articulate that idea, has civil society been able to fill the gap?
Stiglitz: Yes, the Occupy movement has been very successful in bringing
those ideas to the forefront of political discussion. I wrote an article
for Vanity Fair in 2011 – “Of the 1%, by the 1%, for the 1%” – that
really resonated with a lot of people because it spoke to our worries.
Protests like the ones at Occupy Wall Street are only successful when
they pick up on these shared concerns. There was one newspaper article
that described the rough police tactics in Oakland. They interviewed
many people, including police officers, who said: “I agree with the
protesters.” If you ask about the message, the overwhelming response has
been supportive, and the big concern has been that the Occupy movement
hasn’t been effective enough in getting that message across.

The European: How do we move from talking about economic
inequality to tangible change? As you said earlier, the theoretical
recognition of economic problems has often not been translated into
policy.
Stiglitz: If my forecast about the consequences of austerity is correct,
you will see a new round of protest movements. We had a crisis in 2008.
We are now in the fifth year of crisis, and we haven’t solved it.
There’s not even a light at the end of the tunnel. When we come to that
conclusion, the discourse will change.

The European: The situation needs to be really bad before it will get better?
Stiglitz: Yes, I fear.

The European: You recently wrote about the “irreversible
decay” of the American Midwest. Is this crisis a sign that the US has
begun an irreversible economic decline, even while we still regard the
country as a potent political player?
Stiglitz: We are facing a very difficult transition from manufacturing
to a service economy. We have failed to manage that transition smoothly.
If we don’t correct that mistake, we will pay a very high price.
Already, the average American is suffering from the failed transition.
My concern is that we have set in motion an adverse economics and an
adverse politics. A lot of American inequality is caused by
rent-seeking: Monopolies, military spending, procurement, extractive
industries, drugs. We have some economic sectors that are very good, but
we also have a lot of parasites. The hopeful view is that the economy
can grow if we rid ourselves of the parasites and focus on the
productive sectors. But in any disease there is always the risk that the
parasites will devour the healthy body parts. The jury is still out on
that.

The European: Have we at least understood the disease well
enough to prescribe the correct therapy? Especially with regard to
policy-making and the Euro crisis, there seems to be a lot of shooting
into the dark.
Stiglitz: I think the problem is not a lack of understanding by
dispassionate social scientists. We know the basic dilemma, and we know
the effect of campaign contributions on policy-makers. So we are facing a
vicious circle: Because money matters in politics, that leads to
outcomes in which money matters in society, which increases the role of
money in politics. You have more gerrymandering and more disillusionment
with parliamentary politics.

The European: Has politics become too focused on outcomes,
and is it not sensitive enough to the processes that lead to those
outcomes? The bedrock of democracy seems to hinge on the avenues for
participation, not on the effectiveness of particular policies.
Stiglitz: Let me put it this way: Some people criticize by saying that
we have become too focused on inequality and are not concerned enough
about opportunity. But in the United States, we are also the country
with the biggest inequality of opportunity. Most Americans understand
that fraud political processes play in fraud outcomes. But we don’t know
how to break into that system. Our Supreme Court was appointed by
moneyed interests and – not surprisingly – concluded that moneyed
interests had unrestricted influence on politics. In the short run, we
are exacerbating the influence of money, with negative consequences for
the economy and for society.

The European: Where is change rooted? In parliament? In academia? In the streets?
Stiglitz: You look in the streets and a little bit in academia as well.
When I say that the major thrust of the economics profession has
disappointed me, I need to qualify that statement. There have been
groups that push new economic thinking and challenge the old models.

The European: You have written that the challenge is to
respond to bad ideas not with rejection but with better ideas. Where is
the longest and strongest lever to bring new economic thinking into the
realm of policy?
Stiglitz: The diagnosis is that politics is at the root of the problem:
That is where the rules of the game are made, that is where we decide on
policies that favor the rich and that have allowed the financial sector
to amass vast economic and political power. The first step has to be
political reform: Change campaign finance laws. Make it easier for
people to vote – in Australia, they even have compulsory voting. Address
the problem of gerrymandering. Gerrymandering makes it so that your
vote doesn’t count. If it does not count, you are leaving it to moneyed
interests to push their own agenda. Change the filibuster, which turned
from a barely used congressional tactic into a regular feature of
politics. It disempowers Americans. Even if you have a majority vote,
you cannot win.

The European: We’re looking at six months of presidential
campaigning. The role of money has been embraced by both parties.
Campaign finance reform seems rather unlikely.
Stiglitz: Even the Republicans have become more aware of the power of
money by seeing how it influenced and distorted the primaries. The
outcomes are not what the Republican party establishment had hoped for.
The disaster is becoming clear – but that will not lead to immediate
remedies. Those who become elected depend on that money. It will require
a strong third party or civil society to do something about this.

About the Author

Joseph Stiglitz won the Nobel Prize in economics in 2001 for his work on information asymmetry in financial markets. Stiglitz served as senior economist at the World Bank and, from 1993 until 1997, as economic adviser to President Clinton. In 2009, he co-founded the Institute for New Economic Thinking (INET). He teaches at Columbia University.

As it heads toward a House vote, critics say the Cyber Intelligence Sharing and Protection Act (CISPA) would allow private internet companies like Google, Facebook and Microsoft to hand over troves of confidential customer records and communications to the National Security Agency, FBI and Department of Homeland Security, effectively legalizing a secret domestic surveillance program already run by the NSA. Backers say the measure is needed to help private firms crackdown on foreign entities — including the Chinese and Russian governments — committing online economic espionage. The bill has faced widespread opposition from online privacy advocates and even the Obama administration, which has threatened a veto. "CISPA … will create an exception to all existing privacy laws so that companies can share very sensitive and personal information directly with the government, including military agencies like the National Security Agency," says Michelle Richardson, legislative counsel for the American Civil Liberties Union. "Once the government has it, they can repurpose it and use it for a number of things, including an undefined national security use." [ORIGINAL includes rush transcript]

Targeted Hacker Jacob Appelbaum on CISPA, Surveillance and the "Militarization of Cyberspace"

Computer security researcher Jacob Appelbaum argues the measures included in the proposed Cyber Intelligence Sharing and Protection Act (CISPA) would essentially legalize military surveillance of U.S. citizens. "When they want to dramatically expand their ability to do these things in a so-called legal manner, it’s important to note what they’re trying to do is to legalize what they have already been doing," Appelbaum says. He is a developer and advocate for the Tor Project, a network enabling its users to communicate anonymously on the internet, and has volunteered with WikiLeaks. [ORIGINAL includes rush transcript]

Guest:

Jacob Appelbaum, computer security researcher who has volunteered with WikiLeaks. He is a developer and advocate for the Tor Project, a system enabling its users to communicate anonymously on the internet.

Trials Without Crimes Or Evidence

Andy Worthington is a superb reporter who has specialized in
providing the facts of the US government’s illegal abuse of “detainees,”
against whom no evidence exists. ( http://www.andyworthington.co.uk/ )
In an effort to create evidence, the US government has illegally
resorted to torture. Torture produces false confessions, plea bargains,
and false testimony against others in order to escape further torture.

For these reasons, in Anglo-American law self-incrimination secured
through torture has been impermissible evidence for centuries. So also
has been secret evidence withheld from the accused and his attorney.
Secret evidence cannot be confronted. Secret evidence is distrusted as
made-up in order to convict the innocent. The evidence is secret because
it cannot stand the light of day.

The US government relies on secret evidence in its cases against
alleged terrorists, claiming that national security would be threatened
if the evidence were revealed. This is abject nonsense. It is an
absurd claim that presenting evidence against a terrorist jeopardizes
the national security of the United States.

To the contrary, not presenting evidence jeopardizes the security of
each and every one of us. Once the government can convict defendants on
the basis of secret evidence, even the concept of a fair trial will
disappear. Fair trials are already history, but the concept lingers.

Secret evidence murders the concept of a fair trial. It murders
justice and the rule of law. Secret evidence means anyone can be
convicted of anything. As in Kafka’s The Trial,
people will cease to know the crimes for which they are being tried and convicted.

This extraordinary development in Anglo-American law, a development
demanded by the unaccountable Bush/Obama Regime, has not resulted in
impeachment proceedings; nor has it caused an uproar from Congress, the
federal courts, the presstitute media, law schools, constitutional
scholars, and bar associations.

Having bought the government’s 9/11 conspiracy theory, Americans just
want someone to pay. They don’t care who as long as someone pays. To
accommodate this desire, the government has produced some “high value
detainees” with Arab or Muslim names.

But instead of bringing these alleged malefactors to trial and
presenting evidence against them, the government has kept them in
torture dungeons for years trying to create through the application of
pain and psychological breakdown guilt by self-incrimination in order to
create a case against them.

The government has been unsuccessful and has nothing that it can
bring to a real court. So the Bush/Obama Regime created and recreated
“military tribunals” to lend “national security” credence to the
absolute need that non-existent evidence be kept secret.

Andy Worthington in his numerous reports does a good job in providing
the history of the detainees and their treatment. He deserves our
commendation and support. But what I want to do is to ask some
questions, not of Worthington, but about the idea that the US is under
terrorist threat.

By this September, 9/11 will be eleven years ago. Yet despite the
War on Terror, the loss of Americans’ privacy and civil liberties, an
expenditure of trillions of dollars on numerous wars, violations of US
and international laws against torture, and so forth, no one has been
held accountable. Neither the perpetrators nor those whom the
perpetrators outwitted, assuming that they are different people, have
been held accountable. Going on 11 years and no trials of villains or
chastisement of negligent public officials. This is remarkable.

The government’s account of 9/11 implies massive failure of all US
security and intelligence agencies along with those of our NATO puppets
and Israel’s Mossad.

The government’s official line also implies the failure of the National
Security Council, NORAD and the US Air Force, Air Traffic Control,
Airport Security four times in one hour on the same morning. It implies
the failure of the President, the Vice President, the National Security
Adviser, the Secretary of Defense.

Many on the left and also libertarians find this apparent failure of
the centralized and oppressive government so hopeful that they cling to
the official “government failure” explanation of 9/11. However, such
massive failure is simply unbelievable. How in the world could the US
have survived the cold war with the Soviets if the US government were so
totally incompetent?

If we attribute superhero powers to the 19 alleged hijackers, powers
in excess of V’s in V for Vendetta or James Bond’s or Captain Marvel’s,
and assume that these young terrorists, primarily Saudi Arabians,
outwitted Dick Cheney, Condi Rice, The Joint Chiefs of Staff, and Tony
Blair, along with the CIA, FBI, MI5 and MI6, Mossad, etc., one would
have expected for the President, Congress, and the media to call for
heads to roll. No more humiliating affront has ever been suffered by a
major power than the US suffered on 9/11. Yet, absolutely no one, not
even some lowly traffic controller, was scapegoated and held accountable
for what is considered to be the most extraordinarily successful
terrorist attack in human history, an attack so successful that it
implies total negligence across the totality of the US government and
that of all its allies.

This just doesn’t smell right. Total failure and no accountability.
The most expensively funded security apparatus the world has ever known
defeated by a handful of Saudi Arabians. How can anyone in the CIA,
FBI, NSA, NORAD, and National Security Council hold up their heads? What
a disgraced bunch of jerks and incompetents.

What do we need them for?

Consider the alleged hijackers. Despite allegedly being caught off
guard by the 9/11 attacks, the FBI was soon able to identify the 19
hijackers despite the fact that apparently none of the alleged
hijackers’ names are on the passenger lists of the airliners that they
allegedly hijacked.

How did 19 passengers get on airplanes in the US without being on the passenger lists?

I do not personally know if the alleged hijackers were on the four
airliners. Moreover, defenders of the official 9/11 story claim that the
passenger lists released to the public were “victims lists,” not
passenger lists, because the names of the hijackers were withheld and
only released some four years later after 9/11 researchers had had years
in which to confuse victims lists with passenger lists. This seems an
odd explanation. Why encourage public misinformation for years by
withholding the passenger lists and issuing victims lists in their
place? It cannot have been to keep the hijackers’ names a secret as the
FBI released a list of the hijackers several days after 9/11. Even
more puzzling, if the hijackers’ names were on the airline passenger
lists, why did it take the FBI several days to confirm the names and
numbers of hijackers?

Researchers have found contradictions in the FBI’s accounts of the
passenger lists with the FBI adding and subtracting names from its
various lists and some names being misspelled, indicating possibly that
the FBI doesn’t really know who the person is. The authenticity of the
passenger lists that were finally released in 2005 is contested, and the
list apparently was not presented as evidence by the FBI in the
Moussaoui trial in 2006. David Ray Griffin has extensively researched
the 9/11 story. In one of his books, 9/11 Ten Years Later, Griffin
writes: “Although the FBI claimed that it had received flight manifests
from the airlines by the morning of 9/11, the ‘manifests’ that appeared
in 2005 had names that were not known to the FBI until a day or more
after 9/11. These 2005 ‘manifests,’ therefore, could not have been the
original manifests for the four 9/11 flights.”

The airlines themselves have not been forthcoming. We are left with
the mystery of why simple and straightforward evidence, such as a list
of passengers, was withheld for years and mired in secrecy and
controversy.

We have the additional problem that the BBC and subsequently other
news organizations established that 6 or 7 of the alleged hijackers on
the FBI’s list are alive and well and have never been part of any
terrorist plot.

These points are not even a beginning of the voluminous reasons that the government’s 9/11 story looks very thin.

But the American public, being throughly plugged into the Matrix, are
not suspicious of the government’s thin story. Instead, they are
suspicious of the facts and of those experts who are suspicious of the
government’s story. Architects, engineers, scientists, first responders,
pilots, and former public officials who raise objections to the
official story are written off as conspiracy theorists. Why does an
ignorant American public think it knows more than experts? Why do
Americans believe a government that told them the intentional lie that
Saddam Hussein had weapons of mass destruction despite the fact that the
weapons inspectors reported to President Bush that Hussein had no such
weapons? And now we see the same thing all over again with the alleged,
but non-existent, Iranian nukes.

As Frantz Fanon wrote, the power of cognitive dissonance is extreme.
It keeps people comfortable and safe from threatening information. Most
Americans find the government’s lies preferable to the truth. They don’t
want to be unplugged from the Matrix. The truth is too uncomfortable
for emotionally and mentally weak Americans.

Worthington focuses on the harm being done to detainees. They have
been abused for much of their lives. Their innocence or guilt cannot be
established because the evidence is compromised by torture,
self-incrimination, and coerced testimony against others. They stand
convicted by the government’s accusation alone. These are real wrongs,
and Worthington is correct to emphasize them.

In contrast, my focus is on the harm to America, on the harm to truth
and truth’s power, on the harm to the rule of law and accountability to
the people of the government and its agencies, on the harm to the moral
fabric of the US government and to liberty in the United States.

As the adage goes, a fish rots from the head. As the government rots, so does the United States of America.

1 in 2 new graduates are jobless or underemployed

WASHINGTON -- The college class of 2012 is in for a rude welcome to the world of work.

A weak labor market already has left half of young college graduates either jobless or underemployed in positions that don't fully use their skills and knowledge.

Young adults with bachelor's degrees
are increasingly scraping by in lower-wage jobs - waiter or waitress,
bartender, retail clerk or receptionist, for example - and that's
confounding their hopes a degree would pay off despite higher tuition
and mounting student loans.

An analysis of government data conducted for The Associated Press lays bare the highly uneven prospects for holders of bachelor's degrees.

While there's strong demand in science, education and health fields, arts and humanities flounder. Median wages for those with bachelor's degrees are down from 2000, hit by technological changes that are eliminating midlevel jobs such as bank tellers.
Most future job openings are projected to be in lower-skilled positions
such as home health aides, who can provide personalized attention as
the U.S. population ages.

Taking underemployment into consideration, the job prospects for bachelor's degree holders fell last year to the lowest level in more than a decade.

"I
don't even know what I'm looking for," says Michael Bledsoe, who
described months of fruitless job searches as he served customers at a
Seattle coffeehouse. The 23-year-old graduated in 2010 with a creative
writing degree.

Initially hopeful that his college education
would create opportunities, Bledsoe languished for three months before
finally taking a job as a barista, a position he has held for the last
two years. In the beginning he sent three or four resumes day. But,
Bledsoe said, employers questioned his lack of experience or the
practical worth of his major. Now he sends a resume once every two weeks
or so.

Bledsoe, currently making just above minimum wage, says he got financial help from his parents to help pay off student loans.
He is now mulling whether to go to graduate school, seeing few other
options to advance his career. "There is not much out there, it seems,"
he said.

His situation highlights a widening but little-discussed
labor problem. Perhaps more than ever, the choices that young adults
make earlier in life - level of schooling, academic field and training,
where to attend college, how to pay for it - are having long-lasting
financial impact.

"You can make more money on average if you go to
college, but it's not true for everybody," says Harvard economist
Richard Freeman, noting the growing risk of a debt bubble with total
U.S. student loan debt surpassing $1 trillion. "If you're not sure what
you're going to be doing, it probably bodes well to take some job, if
you can get one, and get a sense first of what you want from college."

Andrew Sum, director of the Center for Labor Market Studies at Northeastern University
who analyzed the numbers, said many people with a bachelor's degree
face a double whammy of rising tuition and poor job outcomes. "Simply
put, we're failing kids coming out of college," he said, emphasizing
that when it comes to jobs, a college major can make all the difference.
"We're going to need a lot better job growth and connections to the
labor market, otherwise college debt will grow."

By region, the Mountain West was most likely to have young college graduates
jobless or underemployed - roughly 3 in 5. It was followed by the more
rural southeastern U.S., including Alabama, Kentucky, Mississippi and
Tennessee. The Pacific region, including Alaska, California, Hawaii, Oregon and Washington, also was high on the list.

On the other end of the scale, the southern U.S., anchored by Texas, was most likely to have young college graduates in higher-skill jobs.

The figures are based on an analysis of 2011 Current Population Survey data by Northeastern University researchers and supplemented with material from Paul Harrington, an economist at Drexel University, and the Economic Policy Institute,
a Washington think tank. They rely on Labor Department assessments of
the level of education required to do the job in 900-plus U.S.
occupations, which were used to calculate the shares of young adults
with bachelor's degrees who were "underemployed."

About
1.5 million, or 53.6 percent, of bachelor's degree-holders under the
age of 25 last year were jobless or underemployed, the highest share in
at least 11 years. In 2000, the share was at a low of 41 percent, before
the dot-com bust erased job gains for college graduates in the telecommunications and IT fields.

Out of the 1.5 million who languished in the job market, about half were underemployed, an increase from the previous year.

Broken down by occupation, young college graduates were heavily represented in jobs that require a high school diploma or less.

In
the last year, they were more likely to be employed as waiters,
waitresses, bartenders and food-service helpers than as engineers,
physicists, chemists and mathematicians combined (100,000 versus
90,000). There were more working in office-related jobs such as
receptionist or payroll clerk than in all computer professional jobs
(163,000 versus 100,000). More also were employed as cashiers, retail
clerks and customer representatives than engineers (125,000 versus
80,000).

According to government projections released last month,
only three of the 30 occupations with the largest projected number of
job openings by 2020 will require a bachelor's degree or higher to fill
the position - teachers, college professors and accountants. Most job
openings are in professions such as retail sales, fast food and truck
driving, jobs which aren't easily replaced by computers.

College graduates who majored in zoology, anthropology, philosophy, art history
and humanities were among the least likely to find jobs appropriate to
their education level; those with nursing, teaching, accounting or
computer science degrees were among the most likely.

In Nevada, where unemployment
is the highest in the nation, Class of 2012 college seniors recently
expressed feelings ranging from anxiety and fear to cautious optimism
about what lies ahead.

With the state's economy languishing in an
extended housing bust, a lot of young graduates have shown up at job
placement centers in tears. Many have been squeezed out of jobs by more
experienced workers, job counselors said, and are now having to explain
to prospective employers the time gaps in their resumes.

"It's
kind of scary," said Cameron Bawden, 22, who is graduating from the
University of Nevada-Las Vegas in December with a business degree. His
family has warned him for years about the job market, so he has been
building his resume by working part time on the Las Vegas Strip as a
food runner and doing a marketing internship with a local airline.

Bawden
said his friends who have graduated are either unemployed or working
along the Vegas Strip in service jobs that don't require degrees. "There
are so few jobs and it's a small city," he said. "It's all about who
you know."

Any job gains are going mostly to workers at the top
and bottom of the wage scale, at the expense of middle-income jobs
commonly held by bachelor's degree holders. By some studies, up to 95
percent of positions lost during the economic recovery occurred in
middle-income occupations such as bank tellers, the type of job not
expected to return in a more high-tech age.

David Neumark, an
economist at the University of California-Irvine, said a bachelor's
degree can have benefits that aren't fully reflected in the government's
labor data. He said even for lower-skilled jobs such as waitress or
cashier, employers tend to value bachelor's degree-holders more highly
than high-school graduates, paying them more for the same work and
offering promotions.

In addition, U.S. workers increasingly may
need to consider their position in a global economy, where they must
compete with educated foreign-born residents for jobs. Longer-term
government projections also may fail to consider "degree inflation," a
growing ubiquity of bachelor's degrees that could make them more
commonplace in lower-wage jobs but inadequate for higher-wage ones.

That
future may be now for Kelman Edwards Jr., 24, of Murfreesboro, Tenn.,
who is waiting to see the returns on his college education.

After
earning a biology degree last May, the only job he could find was as a
construction worker for five months before he quit to focus on finding a
job in his academic field. He applied for positions in laboratories but
was told they were looking for people with specialized certifications.

"I
thought that me having a biology degree was a gold ticket for me
getting into places, but every other job wants you to have previous
history in the field," he said. Edwards, who has about $5,500 in student
debt, recently met with a career counselor at Middle Tennessee State
University. The counselor's main advice: Pursue further education.

"Everyone is always telling you, 'Go to college,'" Edwards said. "But when you graduate, it's kind of an empty cliff."

James K. Galbraith teaches economics at the University of Texas where he is a Senior Scholar of the Levy Economics Institute and the Chair of the Board of Economists for Peace and Security. The son of renowned economist, the late, John Kenneth Galbraith, he writes a column called "Econoclast" for Mother Jones, and occasional commentary in many other publications, including The Texas Observer, The American Prospect, and The Nation. He is an occasional commentator for Public Radio International's Marketplace.He directs the University of Texas Inequality Project, an informal research group based at the LBJ School.

“From the beginning,” answer some. English colonists, themselves
under the thumb of a king, exterminated American Indians and stole their
lands, as did late 18th and 19th century Americans. Over the course of
three centuries the native inhabitants of America were dispossessed,
just as Israelis have been driving Palestinians off their lands since
1948.

Demonization always plays a role. The Indians were savages and the
Palestinians are terrorists. Any country that can control the
explanation can get away with evil.

I agree that there is a lot of evil in every country and
civilization. In the struggle between good and evil, religion has at
times been on the side of evil. However, the notion of moral progress
cannot so easily be thrown out.

Consider, for example, slavery. In the 1800s, slavery still existed
in countries that proclaimed equal rights. Even free women did not have
equal rights. Today no Western country would openly tolerate the
ownership of humans or the transfer of a woman’s property upon her
marriage to her husband.

It is true that Western governments have ownership rights in the
labor of their citizens through the income tax. This remains as a
mitigated form of serfdom. So far, however, no government has claimed
the right of ownership over the person himself.

Sometimes I hear from readers that my efforts are pointless, that
elites are always dominant and that the only solution is to find one’s
way into the small, connected clique of elites either through marriage
or service to their interests.

This might sound like cynical advice, but it is not devoid of some
truth. Indeed, it is the way Washington and New York work, and
increasingly the way the entire country operates.

Washington serves powerful private interests, not the public
interest. University faculties in their research increasingly serve
private interests and decreasingly serve truth. In the US the media is
no longer a voice and protection for the people. It is becoming
increasingly impossible in America to get a good job without being
connected to the system that serves the elites.

The problem I have with this “give up” attitude is that over the
course of my life, and more broadly over the course of the 20th century,
many positive changes occurred through reforms. It is impossible to
have reforms without good will, so even the elites who accepted reforms
that limited their powers were part of the moral progress.

Labor unions became a countervailing power to corporate management and Wall Street.

Working conditions were reformed. Civil rights were extended. People
excluded by the system were brought into it. Anyone who grew up in the
20th century can add his own examples.

Progress was slow–unduly so from a reformer’s standpoint–and mistakes
were made. Nevertheless, whether done properly or improperly there was a
commitment to the expansion of civil liberty.

This commitment ended suddenly on September 11, 2001. In eleven years
the Bush/Obama Regime repealed 800 years of human achievements that
established law as a shield of the people and, instead, converted law
into a weapon in the hands of the government. Today Americans and
citizens of other countries can, on the will of the US executive branch
alone, be confined to torture dungeons for the duration of their lives
with no due process or evidence presented to any court, or they can be
shot down in the streets or exterminated by drone missiles.

The power that the US government asserts over its subjects and also
over the citizens of other countries is unlimited. Lenin described
unlimited power as power “resting directly on force, not limited by
anything, not restricted by any laws, nor any absolute rules.”

Washington claims that it is the indispensable government
representing the exceptional people and thereby has the right to impose
its will and “justice” on the rest of the world and that resistance to
Washington constitutes terrorism to be exterminated by any possible
means.

Thus, the American neoconservatives speak of nuking Iran for
insisting on its independence from American hegemony and exercising its
rights to nuclear energy under the non-proliferation treaty to which
Iran is a signatory.

In other words, Washington’s will prevails over international
treaties that have the force of law, treaties which Washington itself
imposed on the world. According to the neoconservatives and Washington,
Iran is not protected by the legal contract that Iran made with
Washington when Iran signed the non-proliferation treaty.

Iran finds itself as just another 17th or 18th century American
Indian tribe to be deprived of its rights and to be exterminated by the
forces of evil that dominate Washington, D.C.

The vast majority of “superpower” americans plugged into the Matrix,
where they are happy with the disinformation pumped into their brains by
Washington and its presstitute media, would demur rather than face my
facts.

This raises the question: how does one become unplugged and unplug
others from the Matrix? Readers have asked, and I do not have a
complete answer.

It seems to happen in a number of ways. Being fired and forced to
train your H-1B foreign replacement who works for lower pay, being
convicted of a crime that you did not commit, having your children
stolen from you by Child Protective Services because bruises from sports
activities were alleged to be signs of child abuse, your home stolen
from you because a mortgage based on fraud was given the force of law,
laid off by “free market capitalism” as your age advanced and the
premium of your employer-provided medical insurance increased, being
harassed by Homeland Security on your re-entry to the US because you are
a non-embedded journalist who reports truthfully on US behavior abroad.
There are many instances of Americans being jolted into reality by the
“freedom and democracy” scales falling away from their eyes.

It is possible that becoming unplugged from the Matrix is a gradual
lifelong experience for the few who pay attention. The longer they live,
the more they notice that reality contradicts the government’s and
media’s explanations. The few who can remember important stuff after
watching reality shows and their favorite sports teams and fantasy
movies gradually realize that there is no “new economy” to take the
place of the manufacturing economy that was given away to foreign
countries. Once unemployed from their “dirty fingernail jobs,” they
learn that there is no “new economy” to employ them.

Still seething from the loss of the Vietnam War and anger at war
protesters, some flag-waving patriots are slowly realizing the
consequences of criminalizing dissent and the exercise of First
Amendment rights. “You are with us or against us” is taking on
threatening instead of reassuring connotations, implying that anyone who
opens his or her mouth in any dissent is thereby transformed into an
“enemy of the state.”

More Americans, but far from enough, are coming to the realization
that the extermination of the Branch Davidians at Waco in 1993 was a
test run to confirm that the public and Congress would accept the murder
of civilians who had been demonized with false charges of child abuse
and gun-running.

The next test was the Oklahoma City Bombing in 1995. Whose
explanation would prevail: the government’s or that of experts? Air
Force General Partin, a top expert on explosives, proved conclusively in
a heavily documented report given to every member of Congress that the
Murruh Federal Office Building blew up from the inside out, not from the
outside in from the fertilizer car bomb. But General Partin’s facts
lost out to the government’s propaganda and to Congress’ avoidance of
cognitive dissonance.

Once the “national security” government learned that its
pronouncements and those of the presstitute media carried more weight
than the facts presented by experts, conspiracies such as Operation
Northwoods could be put into play. A 9/11 became possible.

The Pentagon, CIA, and military/security complex were desperate for a
new enemy to replace the “Soviet threat,” which had ceased to exist.
The military/security complex and its servants in Congress were
determined to replace the profits made from the cold war and to preserve
and increase the powers accumulated in the Pentagon and CIA. The only
possible replacement for the Soviet threat was “Muslim terrorists.”
Thus, the creation of the “al Qaeda threat” and the conflation of this
new threat with secular Arab governments, such as Iraq’s and Syria’s,
which were the real targets of Islamists.

Despite the evidence provided by experts that secular Arab
governments, such as Saddam Hussein’s, were allies against Islamic
extremism, the US government used propaganda to link the secular Iraq
government with Iraq’s enemies among Islamic revolutionaries.

Once Washington confirmed that the American public was both too
ignorant and too inattentive to pay any attention to events that would
alter their lives and jeopardize their existence, every thing else
followed: the PATRIOT Act, the suspension of the Constitution and
destruction of civil liberty, Homeland Security which has quickly
extended its gestapo reach from airports to train stations, bus
terminals and highway road blocks,
the criminalization of dissent, the equating of critics of the
government with supporters of terrorism, the home invasions of antiwar
protesters and their arraignment before a grand jury, the prosecution of
whistleblowers who reveal government crimes, the equating of journalism
organizations such as WikiLeaks with spies. The list goes on.

The collapse of truth in the US and in its puppet states is a major
challenge to my view that truth and good will are powers that can
prevail over evil. It is possible that my perception that moral progress
has occurred in various periods of Western civilization reflects a
progressive unplugging from the Matrix. What I remember as reforms might
be events experienced through the rose colored glasses of the Matrix.

But I think not. Reason is an important part of human existence.
Some are capable of it. Imagination and creativity can escape chains.
Good can withstand evil. The extraordinary film, The Matrix, affirmed
that people could be unplugged. I believe that even americans can be
unplugged. If I give up this belief, I will cease writing.

Blogger's Note: It might seem ironic that a liberal like me could find such information in a magazine called The American Conservative. Indeed, it was very unlikely that I would have stumbled on this essay were it not for Republican Paul Craig Roberts urging the readers of his April 19th blog post to read the original article by Ron Unz, from which he had culled much of his material (I re-posted PCR's article to my blog on April 20th) . The common denominator is that PCR, Ron Unz, and I are scholars who regard that knowledge of the objective truth is the key to making sound policy decisions (where disagreements between traditional liberals and conservatives are small potatoes by comparison with what's happening now). George Orwell best summarized what we all are currently faced with: “In a time of universal deceit - telling the truth is a revolutionary act.”

The rise of China surely ranks among the most important world
developments of the last 100 years. With America still trapped in its
fifth year of economic hardship, and the Chinese economy poised to
surpass our own before the end of this decade, China looms very large on
the horizon. We are living in the early years of what journalists once
dubbed “The Pacific Century,” yet there are worrisome signs it may
instead become known as “The Chinese Century.”

But does the Chinese giant have feet of clay? In a recently published book, Why Nations Fail,
economists Daron Acemoglu and James A. Robinson characterize China’s
ruling elites as “extractive”—parasitic and corrupt—and predict that
Chinese economic growth will soon falter and decline, while America’s
“inclusive” governing institutions have taken us from strength to
strength. They argue that a country governed as a one-party state,
without the free media or checks and balances of our own democratic
system, cannot long prosper in the modern world. The glowing tributes
this book has received from a vast array of America’s most prominent
public intellectuals, including six Nobel laureates in economics,
testifies to the widespread popularity of this optimistic message.

Yet do the facts about China and America really warrant this conclusion?

China Shakes the World

By the late 1970s, three decades of Communist central planning had
managed to increase China’s production at a respectable rate, but with
tremendous fits and starts, and often at a terrible cost: 35 million or
more Chinese had starved to death during the disastrous 1959–1961 famine
caused by Mao’s forced industrialization policy of the Great Leap
Forward.

China’s population had also grown very rapidly during this period, so
the typical standard of living had improved only slightly, perhaps 2
percent per year between 1958 and 1978, and this from an extremely low
base. Adjusted for purchasing power, most Chinese in 1980 had an income
60–70 percent below that of the citizens in other major Third World
countries such as Indonesia, Nigeria, Pakistan, and Kenya, none of which
were considered great economic success stories. In those days, even
Haitians were far wealthier than Chinese.

All this began to change very rapidly once Deng Xiaoping initiated
his free-market reforms in 1978, first throughout the countryside and
eventually in the smaller industrial enterprises of the coastal
provinces. By 1985, The Economist ran a cover story praising
China’s 700,000,000 peasants for having doubled their agricultural
production in just seven years, an achievement almost unprecedented in
world history. Meanwhile, China’s newly adopted one-child policy,
despite its considerable unpopularity, had sharply reduced population
growth rates in a country possessing relatively little arable land.

A combination of slowing population growth and rapidly accelerating
economic output has obvious implications for national prosperity. During
the three decades to 2010, China achieved perhaps the most rapid
sustained rate of economic development in the history of the human
species, with its real economy growing almost 40-fold between 1978 and
2010. In 1978, America’s economy was 15 times larger, but according to
most international estimates, China is now set to surpass America’s
total economic output within just another few years.

Furthermore, the vast majority of China’s newly created economic
wealth has flowed to ordinary Chinese workers, who have moved from oxen
and bicycles to the verge of automobiles in just a single generation.
While median American incomes have been stagnant for almost forty years,
those in China have nearly doubled every decade, with the real wages of
workers outside the farm-sector rising about 150 percent over the last
ten years alone. The Chinese of 1980 were desperately poor compared to
Pakistanis, Nigerians, or Kenyans; but today, they are several times
wealthier, representing more than a tenfold shift in relative income.

A World Bank report recently highlighted the huge drop in global
poverty rates from 1980 to 2008, but critics noted that over 100 percent
of that decline came from China alone: the number of Chinese living in
dire poverty fell by a remarkable 662 million, while the impoverished
population in the rest of the world actually rose by 13 million. And
although India is often paired with China in the Western media, a large
fraction of Indians have actually grown poorer over time. The bottom
half of India’s still rapidly growing population has seen its daily
caloric intake steadily decline for the last 30 years, with half of all
children under five now being malnourished.

China’s economic progress is especially impressive when matched
against historical parallels. Between 1870 and 1900, America enjoyed
unprecedented industrial expansion, such that even Karl Marx and his
followers began to doubt that a Communist revolution would be necessary
or even possible in a country whose people were achieving such widely
shared prosperity through capitalistic expansion. During those 30 years
America’s real per capita income grew by 100 percent. But over the last
30 years, real per capita income in China has grown by more than 1,300
percent.

Over the last decade alone, China quadrupled its industrial output,
which is now comparable to that of the U.S. In the crucial sector of
automobiles, China raised its production ninefold, from 2 million cars
in 2000 to 18 million in 2010, a figure now greater than the combined
totals for America and Japan. China accounted for fully 85 percent of
the total world increase in auto manufacturing during that decade.

It is true that many of China’s highest-tech exports are more
apparent than real. Nearly all Apple’s iPhones and iPads come from
China, but this is largely due to the use of cheap Chinese labor for
final assembly, with just 4 percent of the value added in those
world-leading items being Chinese. This distorts Chinese trade
statistics, leading to unnecessary friction. However, some high-tech
China exports are indeed fully Chinese, notably those of Huawei, which
now ranks alongside Sweden’s Ericsson as one of the world’s two leading
telecommunications manufacturers, while once powerful North American
competitors such Lucent-Alcatel and Nortel have fallen into steep
decline or even bankruptcy. And although America originally pioneered
the Human Genome Project, the Beijing Genomics Institute (BGI) today
probably stands as the world leader in that enormously important
emerging scientific field.

China’s recent rise should hardly surprise us. For most of the last
3,000 years, China together with the Mediterranean world and its
adjoining European peninsula have constituted the two greatest world
centers of technological and economic progress. During the 13th century,
Marco Polo traveled from his native Venice to the Chinese Empire and
described the latter as vastly wealthier and more advanced than any
European country. As late as the 18th century, many leading European
philosophers such as Voltaire often looked to Chinese society as an
intellectual exemplar, while both the British and the Prussians used the
Chinese mandarinate as their model for establishing a meritocratic
civil service based on competitive examinations.

Even a century ago, near the nadir of China’s later weakness and
decay, some of America’s foremost public intellectuals, such as Edward
A. Ross and Lothrop Stoddard, boldly predicted the forthcoming
restoration of the Chinese nation to global influence, the former with
equanimity and the latter with serious concern. Indeed, Stoddard argued
that only three major inventions effectively separated the world of
classical antiquity from that of 18th-century Europe—gunpowder, the
mariner’s compass, and the printing press. All three seem to have first
appeared in China, though for various social, political, and ideological
reasons, none were properly implemented.

Does China’s rise necessarily imply America’s decline? Not at all:
human economic progress is not a zero-sum game. Under the right
circumstances, the rapid development of one large country should tend to
improve living standards for the rest of the world.

This is most obvious for those nations whose economic strengths
directly complement those of a growing China. Massive industrial
expansion clearly requires a similar increase in raw-material
consumption, and China is now the world’s largest producer and user of
electricity, concrete, steel, and many other basic materials, with its
iron-ore imports surging by a factor of ten between 2000 and 2011. This
has driven huge increases in the costs of most commodities; for example,
copper’s world price rose more than eightfold during the last decade.
As a direct consequence, these years have generally been very good ones
for the economies of countries that heavily rely upon the export of
natural resources—Australia, Russia, Brazil, Saudi Arabia, and parts of
Africa.

Meanwhile, as China’s growth gradually doubles total world industrial
production, the resulting “China price” reduces the cost of
manufactured goods, making them much more easily affordable to everyone,
and thereby greatly increases the global standard of living. While this
process may negatively impact those particular industries and countries
directly competing with China, it provides enormous opportunities as
well, not merely to the aforementioned raw-material suppliers but also
to countries like Germany, whose advanced equipment and machine tools
have found a huge Chinese market, thereby helping to reduce German
unemployment to the lowest level in 20 years.

And as ordinary Chinese grow wealthier, they provide a larger market
as well for the goods and services of leading Western companies, ranging
from fast-food chains to consumer products to luxury goods. Chinese
workers not only assemble Apple’s iPhones and iPads, but are also very
eager to purchase them, and China has now become that company’s second
largest market, with nearly all of the extravagant profit margins
flowing back to its American owners and employees. In 2011 General
Motors sold more cars in China than in the U.S., and that rapidly
growing market became a crucial factor in the survival of an iconic
American corporation. China has become the third largest market in the
world for McDonald’s, and the main driver of global profits for the
American parent company of Pizza Hut, Taco Bell, and KFC.

Social Costs of a Rapid Rise

Transforming a country in little more than a single generation from a
land of nearly a billion peasants to one of nearly a billion
city-dwellers is no easy task, and such a breakneck pace of industrial
and economic development inevitably leads to substantial social costs.
Chinese urban pollution is among the worst in the world, and traffic is
rapidly heading toward that same point. China now contains the second
largest number of billionaires after America, together with more than a
million dollar-millionaires, and although many of these individuals came
by their fortunes honestly, many others did not. Official corruption is
a leading source of popular resentment against the various levels of
Chinese government, ranging from local village councils to the highest
officials in Beijing.

But we must maintain a proper sense of proportion. As someone who
grew up in Los Angeles when it still had the most notorious smog in
America, I recognize that such trends can be reversed with time and
money, and indeed the Chinese government has expressed intense interest
in the emerging technology of non-polluting electric cars. Rapidly
growing national wealth can be deployed to solve many problems.

Similarly, plutocrats who grow rich through friends in high places or
even outright corruption are easier to tolerate when a rising tide is
rapidly lifting all boats. Ordinary Chinese workers have increased their
real income by well over 1,000 percent in recent decades, while the
corresponding figure for most American workers has been close to zero.
If typical American wages were doubling every decade, there would be far
less anger in our own society directed against the “One Percent.”
Indeed, under the standard GINI index used to measure wealth inequality,
China’s score is not particularly high, being roughly the same as that
of the United States, though certainly indicating greater inequality
than most of the social democracies of Western Europe.

Many American pundits and politicians still focus their attention on
the tragic Tiananmen Square incident of 1989, during which hundreds of
determined Chinese protesters were massacred by government troops. But
although that event loomed very large at the time, in hindsight it
generated merely a blip in the upward trajectory of China’s development
and today seems virtually forgotten among ordinary Chinese, whose real
incomes have increased several-fold in the quarter century since then.

Much of the Tiananmen protest had been driven by popular outrage at
government corruption, and certainly there have been additional major
scandals in recent years, often heavily splashed across the pages of
America’s leading newspapers. But a closer examination paints a more
nuanced picture, especially when contrasted with America’s own
situation.

For example, over the last few years one of the most ambitious
Chinese projects has been a plan to create the world’s largest and most
advanced network of high-speed rail transport, an effort that absorbed a
remarkable $200 billion of government investment. The result was the
construction of over 6,000 miles of track, a total probably now greater
than that of all the world’s other nations combined. Unfortunately, this
project also involved considerable corruption, as was widely reported
in the world media, which estimated that hundreds of millions of dollars
had been misappropriated through bribery and graft. This scandal
eventually led to the arrest or removal of numerous government
officials, notably including China’s powerful Railways Minister.

Obviously such serious corruption would seem horrifying in a country
with the pristine standards of a Sweden or a Norway. But based on the
published accounts, it appears that the funds diverted amounted to
perhaps as little as 0.2 percent of the total, with the remaining 99.8
percent generally spent as intended. So serious corruption
notwithstanding, the project succeeded and China does indeed now possess
the world’s largest and most advanced network of high-speed rail,
constructed almost entirely in the last five or six years.

Meanwhile, America has no high-speed rail whatsoever, despite decades
of debate and vast amounts of time and money spent on lobbying,
hearings, political campaigns, planning efforts, and
environmental-impact reports. China’s high-speed rail system may be far
from perfect, but it actually exists, while America’s does not. Annual
Chinese ridership now totals over 25 million trips per year, and
although an occasional disaster—such as the 2011 crash in Weizhou, which
killed 40 passengers—is tragic, it is hardly unexpected. After all,
America’s aging low-speed trains are not exempt from similar calamities,
as we saw in the 2008 Chatsworth crash that killed 25 in California.

For many years Western journalists regularly reported that the
dismantling of China’s old Maoist system of government-guaranteed
healthcare had led to serious social stresses, forcing ordinary workers
to save an unreasonable fraction of their salaries to pay for medical
treatment if they or their families became ill. But over the last couple
of years, the government has taken major steps to reduce this problem
by establishing a national healthcare insurance system whose coverage
now extends to 95 percent or so of the total population, a far better
ratio than is found in wealthy America and at a tiny fraction of the
cost. Once again, competent leaders with access to growing national
wealth can effectively solve these sorts of major social problems.

Although Chinese cities have negligible crime and are almost entirely
free of the horrible slums found in many rapidly urbanizing Third World
countries, housing for ordinary workers is often quite inadequate. But
national concerns over rising unemployment due to the global recession
gave the government a perfect opportunity late last year to announce a
bold plan to construct over 35 million modern new government apartments,
which would then be provided to ordinary workers on a subsidized basis.

All of this follows the pattern of Lee Kwan Yew’s mixed-development
model, combining state socialism and free enterprise, which raised
Singapore’s people from the desperate, abject poverty of 1945 to a
standard of living now considerably higher than that of most Europeans
or Americans, including a per capita GDP almost $12,000 above that of
the United States. Obviously, implementing such a program for the
world’s largest population and on a continental scale is far more
challenging than doing so in a tiny city-state with a population of a
few million and inherited British colonial institutions, but so far
China has done very well in confounding its skeptics.

America’s Economic Decline

These facts do not provide much evidence for the thesis in Why Nations Fail
that China’s leaders constitute a self-serving and venal “extractive”
elite. Unfortunately, such indications seem far more apparent when we
direct our gaze inward, toward the recent economic and social trajectory
of our own country

Against the backdrop of remarkable Chinese progress, America mostly
presents a very gloomy picture. Certainly America’s top engineers and
entrepreneurs have created many of the world’s most important
technologies, sometimes becoming enormously wealthy in the process. But
these economic successes are not typical nor have their benefits been
widely distributed. Over the last 40 years, a large majority of American
workers have seen their real incomes stagnate or decline.

Meanwhile, the rapid concentration of American wealth continues
apace: the richest 1 percent of America’s population now holds as much
net wealth as the bottom 90–95 percent, and these trend may even be
accelerating. A recent study revealed that during our supposed recovery
of the last couple of years, 93 percent of the total increase in
national income went to the top 1 percent, with an astonishing 37
percent being captured by just the wealthiest 0.01 percent of the
population, 15,000 households in a nation of well over 300 million
people.

Evidence for the long-term decline in our economic circumstances is
most apparent when we consider the situation of younger Americans. The
national media endlessly trumpets the tiny number of youthful Facebook
millionaires, but the prospects for most of their contemporaries are
actually quite grim. According to research from the Pew Center, barely
half of 18- to 24-year-old Americans are currently employed, the lowest
level since 1948, a time long before most women had joined the labor
force. Nearly one-fifth of young men age 25–34 are still living with
their parents, while the wealth of all households headed by those
younger than 35 is 68 percent lower today than it was in 1984.

The total outstanding amount of non-dischargeable student-loan debt
has crossed the trillion-dollar mark, now surpassing the combined total
of credit-card and auto-loan debt—and with a quarter of all student-loan
payers now delinquent, there are worrisome indicators that much of it
will remain a permanent burden, reducing many millions to long-term debt
peonage. A huge swath of America’s younger generation seems completely
impoverished, and likely to remain so.

International trade statistics, meanwhile, demonstrate that although
Apple and Google are doing quite well, our overall economy is not. For
many years now our largest goods export has been government IOUs, whose
dollar value has sometimes been greater than that of the next ten
categories combined. At some point, perhaps sooner than we think, the
rest of the world will lose its appetite for this non-functional
product, and our currency will collapse, together with our standard of
living. Similar Cassandra-like warnings were issued for years about the
housing bubble or the profligacy of the Greek government, and were
proven false year after year until one day they suddenly became true.

Ironically enough, there is actually one major category in which
American expansion still easily tops that of China, both today and for
the indefinite future: population growth. The rate of America’s
demographic increase passed that of China over 20 years ago and has been
greater every year since, sometimes by as much as a factor of two.
According to standard projections, China’s population in 2050 will be
almost exactly what it was in 2000, with the country having achieved the
population stability typical of advanced, prosperous societies. But
during that same half-century, the number of America’s inhabitants will
have grown by almost 50 percent, a rate totally unprecedented in the
developed world and actually greater than that found in numerous Third
World countries such as Colombia, Algeria, Thailand, Mexico, or
Indonesia. A combination of very rapid population growth and doubtful
prospects for equally rapid economic growth does not bode well for the
likely quality of the 2050 American Dream.

China rises while America falls, but are there major causal
connections between these two concurrent trends now reshaping the future
of our world? Not that I can see. American politicians and pundits are
naturally fearful of taking on the fierce special interest groups that
dominate their political universe, so they often seek an external
scapegoat to explicate the misery of their constituents, sometimes
choosing to focus on China. But this is merely political theater for the
ignorant and the gullible.

Various studies have suggested that China’s currency may be
substantially undervalued, but even if the frequent demands of Paul
Krugman and others were met and the yuan rapidly appreciated another 15
or 20 percent, few industrial jobs would return to American shores,
while working-class Americans might pay much more for their basic
necessities. And if China opened wide its borders to more American
movies or financial services, the multimillionaires of Hollywood and
Wall Street might grow even richer, but ordinary Americans would see
little benefit. It is always easier for a nation to point an accusing
finger at foreigners rather than honestly admit that almost all its
terrible problems are essentially self-inflicted.

Decay of Constitutional Democracy

The central theme of Why Nations Fail is that political
institutions and the behavior of ruling elites largely determine the
economic success or failure of countries. If most Americans have
experienced virtually no economic gains for decades, perhaps we should
cast our gaze at these factors in our own society.

Our elites boast about the greatness of our constitutional democracy,
the wondrous human rights we enjoy, the freedom and rule of law that
have long made America a light unto the nations of the world and a
spiritual draw for oppressed peoples everywhere, including China itself.
But are these claims actually correct? They often stack up very
strangely when they appear in the opinion pages of our major newspapers,
coming just after the news reporting, whose facts tell a very different
story.

Just last year, the Obama administration initiated a massive
months-long bombing campaign against the duly recognized government of
Libya on “humanitarian” grounds, then argued with a straight face that a
military effort comprising hundreds of bombing sorties and over a
billion dollars in combat costs did not actually constitute “warfare,”
and hence was completely exempt from the established provisions of the
Congressional War Powers Act. A few months later, Congress
overwhelmingly passed and President Obama signed the National Defense
Authorization Act, granting the president power to permanently imprison
without trial or charges any American whom he classifies as a
national-security threat based on his own judgment and secret evidence.
When we consider that American society has experienced virtually no
domestic terrorism during the past decade, we must wonder how long our
remaining constitutional liberties would survive if we were facing
frequent real-life attacks by an actual terrorist underground, such as
had been the case for many years with the IRA in Britain, ETA in Spain,
or the Red Brigades in Italy.

Most recently, President Obama and Attorney General Eric Holder have
claimed the inherent right of an American president to summarily execute
anyone anywhere in the world, American citizen or not, whom White House
advisors have privately decided was a “bad person.” While it is
certainly true that major world governments have occasionally
assassinated their political enemies abroad, I have never before heard
these dark deeds publicly proclaimed as legitimate and aboveboard.
Certainly if the governments of Russia or China, let alone Iran,
declared their inherent right to kill anyone anywhere in the world whom
they didn’t like, our media pundits would immediately blast these
statements as proof of their total criminal insanity.

These are very strange notions of the “rule of law” for the
administration of a president who had once served as top editor of the Harvard Law Review and who was routinely flattered in his political campaigns by being described as a “constitutional scholar.”

Many of these negative ideological trends have been absorbed and
accepted by the popular culture and much of the American public. Over
the last decade one of the highest-rated shows on American television
was “24”, created by Joel Surnow and chronicling Kiefer Sutherland as a
patriotic but ruthless Secret Service agent, with each episode
constituting a single hour of his desperate efforts to thwart terrorist
plots and safeguard our national security. Numerous episodes featured
our hero torturing suspected evildoers in order to extract the
information necessary to save innocent lives, with the entire series
representing a popular weekly glorification of graphic government
torture on behalf of the greater good.

Now soft-headed protestations to the contrary, most governments
around the world have at least occasionally practiced torture,
especially when combating popular insurgencies, and some of the more
brutal regimes, including Stalinist Russia and Nazi Germany, even
professionalized the process. But such dark deeds done in secret were
always vigorously denied in public, and the popular films and other
media of Stalin’s Soviet Union invariably featured pure-hearted workers
and peasants bravely doing their honorable and patriotic duty for the
Motherland, rather than the terrible torments being daily inflicted in
the cellars of the Lubyanka prison. Throughout all of modern history, I
am not aware of a single even semi-civilized country that publicly
celebrated the activities of its professional government torturers in
the popular media. Certainly such sentiments would have been totally
abhorrent and unthinkable in the “conservative Hollywood” of the Cold
War 1950s.

And since we live in a entertainment-dominated society, sentiments
affirmed on the screen often have direct real-world consequences. At one
point, senior American military and counter-terrorism officials felt
the need to travel to Hollywood and urge its screenwriters to stop
glorifying American torture, since their shows were encouraging U.S.
soldiers to torture Muslim captives even when their commanding officers
repeatedly ordered them not to do so.

Given these facts, we should hardly be surprised that international
surveys over the past decade have regularly ranked America as the
world’s most hated major nation, a remarkable achievement given the
dominant global role of American media and entertainment and also the
enormous international sympathy that initially flowed to our country
following the 9/11 attacks.

An Emerging One-Party State

So far at least, these extra-constitutional and often brutal methods
have not been directed toward controlling America’s own political
system; we remain a democracy rather than a dictatorship. But does our
current system actually possess the central feature of a true democracy,
namely a high degree of popular influence over major government
policies? Here the evidence seems more ambiguous.

Consider the pattern of the last decade. With two ruinous wars and a
financial collapse to his record, George W. Bush was widely regarded as
one of the most disastrous presidents in American history, and at times
his public approval numbers sank to the lowest levels ever measured. The
sweeping victory of his successor, Barack Obama, represented more a
repudiation of Bush and his policies than anything else, and leading
political activists, left and right alike, characterized Obama as Bush’s
absolute antithesis, both in background and in ideology. This sentiment
was certainly shared abroad, with Obama being selected for the Nobel
Peace Prize just months after entering office, based on the widespread
assumption that he was certain to reverse most of the policies of his
detested predecessor and restore America to sanity.

Yet almost none of these reversals took place. Instead, the
continuity of administration policy has been so complete and so obvious
that many critics now routinely speak of the Bush/Obama administration.

The harsh violations of constitutional principles and civil liberties
which Bush pioneered following the 9/11 attacks have only further
intensified under Obama, the heralded Harvard constitutional scholar and
ardent civil libertarian, and this has occurred without the excuse of
any major new terrorist attacks. During his Democratic primary campaign,
Obama promised that he would move to end Bush’s futile Iraq War
immediately upon taking office, but instead large American forces
remained in place for years until heavy pressure from the Iraqi
government finally forced their removal; meanwhile, America’s occupation
army in Afghanistan actually tripled in size. The government bailout of
the hated financial manipulators of Wall Street, begun under Bush,
continued apace under Obama, with no serious attempts at either
government prosecution or drastic reform. Americans are still mostly
suffering through the worst economic downturn since the Great
Depression, but Wall Street profits and multimillion-dollar bonuses soon
returned to record levels.

In particular, the continuity of top officials has been remarkable.
As Bush’s second defense secretary, Robert Gates had been responsible
for the ongoing management of America’s foreign wars and military
occupations since 2006; Obama kept him on, and he continued to play the
same role in the new administration. Similarly, Timothy Geithner had
been one of Bush’s most senior financial appointments, playing a crucial
role in the widely unpopular financial bailout of Wall Street; Obama
promoted him to Treasury secretary and authorized continuation of those
same policies. Ben Bernanke had been appointed chairman of the Federal
Reserve by Bush and was reappointed by Obama. Bush wars and bailouts
became Obama wars and bailouts. The American public voted for an
anti-Bush, but got Bush’s third term instead.

During the Cold War, Soviet propagandists routinely characterized our
democracy as a sham, with the American public merely selecting which of
the two intertwined branches of their single political party should
alternate in office, while the actual underlying policies remained
essentially unchanged, being decided and implemented by the same corrupt
ruling class. This accusation may have been mostly false at the time it
was made but seems disturbingly accurate today.

When times are hard and government policies are widely unpopular, but
voters are only offered a choice between the rival slick marketing
campaigns of Coke and Pepsi, cynicism can reach extreme proportions.
Over the last year, surveys have shown that the public non-approval of
Congress—representing Washington’s political establishment—has ranged as
high as 90–95 percent, which is completely unprecedented.

But if our government policies are so broadly unpopular, why are we
unable to change them through the sacred power of the vote? The answer
is that America’s system of government has increasingly morphed from
being a representative democracy to becoming something closer to a
mixture of plutocracy and mediacracy, with elections almost entirely
determined by money and media, not necessarily in that order. Political
leaders are made or broken depending on whether they receive the cash
and visibility needed to win office.

National campaigns increasingly seem sordid reality shows for
second-rate political celebrities, while our country continues along its
path toward multiple looming calamities. Candidates who depart from the
script or deviate from the elite D.C. consensus regarding wars or
bailouts—notably a principled ideologue such as Ron Paul—are routinely
stigmatized in the media as dangerous extremists or even entirely
airbrushed out of campaign news coverage, as has been humorously
highlighted by comedian Jon Stewart.

We know from the collapsed communist states of Eastern Europe that
control over the media may determine public perceptions of reality, but
it does not change the underlying reality itself, and reality usually
has the last laugh. Economics Nobel Laureate Joseph Stiglitz and his
colleagues have conservatively estimated the total long-term cost of our
disastrous Iraq War at $3 trillion, representing over one-fifth of our
entire accumulated national debt, or almost $30,000 per American
household. And even now the direct ongoing costs of our Afghanistan War
still run $120 billion per year, many times the size of Afghanistan’s
total GDP. Meanwhile, during these same years the international price of
oil has risen from $25 to $125 per barrel—partly as a consequence of
these past military disruptions and growing fears of future ones—thereby
imposing gigantic economic costs upon our society.

And we suffer other costs as well. A recent New York Times
story described the morale-building visit of Secretary of Defense Leon
Panetta to our forces in Afghanistan and noted that all American troops
had been required to surrender their weapons before attending his speech
and none were allowed to remain armed in his vicinity. Such a command
decision seems almost unprecedented in American history and does not
reflect well upon the perceived state of our military morale.

Future historians may eventually regard these two failed wars, fought
for entirely irrational reasons, as the proximate cause of America’s
financial and political collapse, representing the historical bookend to
our World War II victory, which originally established American global
dominance.

Our Extractive Elites

When parasitic elites govern a society along “extractive” lines, a
central feature is the massive upward flow of extracted wealth,
regardless of any contrary laws or regulations. Certainly America has
experienced an enormous growth of officially tolerated corruption as our
political system has increasingly consolidated into a one-party state
controlled by a unified media-plutocracy.

Consider the late 2011 collapse of MF Global, a midsize but highly
reputable brokerage firm. Although this debacle was far smaller than the
Lehman bankruptcy or the Enron fraud, it effectively illustrates the
incestuous activities of America’s overlapping elites. Just a year
earlier, Jon Corzine had been installed as CEO, following his terms as
Democratic governor and U.S. senator from New Jersey and his previous
career as CEO of Goldman Sachs. Perhaps no other American had such a
combination of stellar political and financial credentials on his
resume. Soon after taking the reins, Corzine decided to boost his
company’s profits by betting its entire capital and more against the
possibility that any European countries might default on their national
debts. When he lost that bet, his multi-billion-dollar firm tumbled into
bankruptcy.

At this point, the story moves from a commonplace tale of Wall Street
arrogance and greed into something out of the Twilight Zone, or perhaps
Monty Python. The major newspapers began reporting that customer funds,
eventually said to total $1.6 billion, had mysteriously disappeared
during the collapse, and no one could determine what had become of them,
a very strange claim in our age of massively computerized financial
records. Weeks and eventually months passed, tens of millions of dollars
were spent on armies of investigators and forensic accountants, but all
those customer funds stayed “missing,” while the elite media covered
this bizarre situation in the most gingerly possible fashion. As an
example, a front page Wall Street Journal story on February 23,
2012 suggested that after so many months, there seemed little
likelihood that the disappeared customer funds might ever reappear, but
also emphasized that absolutely no one was being accused of any
wrongdoing. Presumably the journalists were suggesting that the $1.6
billion dollars of customer money had simply walked out the door on its
own two feet.

Stories like this give the lie to the endless boasts of our
politicians and business pundits that America’s financial system is the
most transparent and least corrupt in today’s world. Certainly America
is not unique in the existence of long-term corporate fraud, as was
recently shown in the fall of Japan’s Olympus Corporation following the
discovery of more than a billion dollars in long-hidden investment
losses. But when we consider the largest corporate collapses of the last
decade that were substantially due to fraud, nearly all the names are
American: WorldCom, Enron, Tyco, Global Crossing, and Adelphia. And this
list leaves out all the American financial institutions destroyed by
the financial meltdown—such as Lehman, Bear Stearns, Merrill Lynch,
Washington Mutual, and Wachovia—and the many trillions of dollars in
American homeowner equity and top-rated MBS securities which evaporated
during that process. Meanwhile, the largest and longest Ponzi Scheme in
world history, that of Bernie Madoff, had survived for decades under the
very nose of the SEC, despite a long series of detailed warnings and
complaints. The second largest such fraud, that of Allen R. Stanford,
also bears the label “Made in the USA.”

Some of the sources of Chinese success and American decay are not
entirely mysterious. As it happens, the typical professional background
of a member of China’s political elite is engineering; they were taught
to build things. Meanwhile, a remarkable fraction of America’s political
leadership class attended law school, where they were trained to argue
effectively and to manipulate. Thus, we should not be greatly surprised
that while China’s leaders tend to build, America’s leaders seem to
prefer endless manipulation, whether of words, money, or people.

How
corrupt is the American society fashioned by our current ruling elites?
That question is perhaps more ambiguous than it might seem. According
to the standard world rankings produced by Transparency International,
the United States is a reasonably clean country, with corruption being
considerably higher than in the nations of Northern Europe or elsewhere
in the Anglosphere, but much lower than in most of the rest of the
world, including China.

But I suspect that this one-dimensional metric fails to capture some
of the central anomalies of America’s current social dilemma. Unlike the
situation in many Third World countries, American teachers and tax
inspectors very rarely solicit bribes, and there is little overlap in
personnel between our local police and the criminals whom they pursue.
Most ordinary Americans are generally honest. So by these basic measures
of day-to-day corruption, America is quite clean, not too different
from Germany or Japan.

By contrast, local village authorities in China have a notorious
tendency to seize public land and sell it to real estate developers for
huge personal profits. This sort of daily misbehavior has produced an
annual Chinese total of up to 90,000 so-called “mass incidents”—public
strikes, protests, or riots—usually directed against corrupt local
officials or businessmen.

However, although American micro-corruption is rare, we seem to
suffer from appalling levels of macro-corruption, situations in which
our various ruling elites squander or misappropriate tens or even
hundreds of billions of dollars of our national wealth, sometimes doing
so just barely on one side of technical legality and sometimes on the
other.

Sweden is among the cleanest societies in Europe, while Sicily is
perhaps the most corrupt. But suppose a large clan of ruthless Sicilian
Mafiosi moved to Sweden and somehow managed to gain control of its
government. On a day-to-day basis, little would change, with Swedish
traffic policemen and building inspectors performing their duties with
the same sort of incorruptible efficiency as before, and I suspect that
Sweden’s Transparency International rankings would scarcely decline. But
meanwhile, a large fraction of Sweden’s accumulated national wealth
might gradually be stolen and transferred to secret Cayman Islands bank
accounts, or invested in Latin American drug cartels, and eventually the
entire plundered economy would collapse.

Ordinary Americans who work hard and seek to earn an honest living
for themselves and their families appear to be suffering the ill effects
of exactly this same sort of elite-driven economic pillage. The roots
of our national decline will be found at the very top of our society,
among the One Percent, or more likely the 0.1 percent.

Thus, the ideas presented in Why Nations Fail seem both true
and false. The claim that harmful political institutions and corrupt
elites can inflict huge economic damage upon a society seems absolutely
correct. But while the authors turn a harsh eye toward elite misbehavior
across time and space—from ancient Rome to Czarist Russia to rising
China—their vision seems to turn rosy-tinted when they consider
present-day America, the society in which they themselves live and whose
ruling elites lavishly fund the academic institutions with which they
are affiliated. Given the American realities of the last dozen years, it
is quite remarkable that the scholars who wrote a book entitled Why Nations Fail never glanced outside their own office windows.

A similar dangerous reticence may afflict most of our media, which
appears much more eager to focus on self-inflicted disasters in foreign
countries than on those here at home. Presented below is a companion
case-study, “Chinese Melamine and American Vioxx: A Comparison,”
in which I point out that while the American media a few years ago
joined its Chinese counterparts in devoting enormous coverage to the
deaths of a few Chinese children from tainted infant formula, it paid
relatively little attention to a somewhat similar domestic public-health
disaster that killed many tens or even hundreds of thousands of
Americans.

A society’s media and academic organs constitute the sensory
apparatus and central nervous system of its body politic, and if the
information these provide is seriously misleading, looming dangers may
fester and grow. A media and academy that are highly corrupt or
dishonest constitute a deadly national peril. And although the political
leadership of undemocratic China might dearly wish to hide all its
major mistakes, its crude propaganda machinery often fails at this
self-destructive task. But America’s own societal information system is
vastly more skilled and experienced in shaping reality to meet the needs
of business and government leaders, and this very success does
tremendous damage to our country.

Perhaps Americans really do prefer that their broadcasters provide
Happy News and that their political campaigns constitute amusing reality
shows. Certainly the cheering coliseum crowds of the Roman Empire
favored their bread and circuses over the difficult and dangerous tasks
that their ancestors had undertaken during Rome’s rise to world
greatness. And so long as we can continue to trade bits of printed paper
carrying presidential portraits for flat-screen TVs from Chinese
factories, perhaps all is well and no one need be too concerned about
the apparent course of our national trajectory, least of all our
political leadership class.

But if so, then we must admit that Richard Lynn, a prominent British
scholar, has been correct in predicting for a decade or longer that the
global dominance of the European-derived peoples is rapidly drawing to
its end and within the foreseeable future the torch of human progress
and world leadership will inevitably pass into Chinese hands.

Ron Unz is publisher of The American Conservative and founder of Unz.org.

About Me

B.S. in Physics, Carnegie-Mellon University, 1960 Ph.D. in Physics, Brown University, 1966. Fellow, American Physical
Society. Fellow, American Association for the Advancement of Science.
Fellow, American Ceramic Society. Member, Geological Society of America, Research Physicist at Naval Research Laboratory (NRL), Washington, DC,
1967-2001. Fulbright-García Robles Fellow at Universidad Nacional
Autónoma de México, 1997. Invited Professor of Research at Universités
de Paris-6 & 7, Lyon-1, et St-Etienne (France) and Tokyo Institute
of Technology, 2000-2004. Adjunct Professor of Materials Science and
Engineering, University of Arizona, 2004-2005. Consultancy: impactGlass
research international, 2005-present.
Winner, one national and two international research awards and honored
by Brown University with a "Distinguished Graduate School Alumnus
Award." Author, 198 papers in peer-reviewed journals and books, Principal Author of 114 of these.